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LEDS Nasdaq· SemiLEDs Corporation
Earnings report Q4 2023

LEDS Reports Decrease in Revenue for Q4 2023

Segments of revenue

In the three months ended November 30, 2023, LEDS generated revenues from different segments as follows:

  • LED chips: $58,000, accounting for 4% of total revenues. This represents an 18% increase compared to the same period in 2022.
  • LED components: $1.075 million, representing 65% of total revenues. This segment experienced a 29% increase in revenue compared to the previous year.
  • Lighting products: $49,000, contributing 3% to total revenues. However, this segment experienced a significant decline of 68% in revenue compared to the same period in 2022.
  • Other operating revenues: $468,000, representing 28% of total revenues. This segment saw a decrease of 29% in revenue compared to the previous year.

Strengths

LEDS has shown strength in the LED components segment, with a significant increase in revenue due to higher volumes sold. This indicates a growing demand for LED components, which could be attributed to the global push for more energy-efficient lighting solutions. LEDS has historically derived a significant portion of its revenues from a limited number of customers, but the company has been broadening its customer base, which may contribute to revenue stability in the long term.

Challenges

LEDS faces challenges in the LED chips segment, as the revenue increase is primarily due to varying volumes sold. This suggests that the company may face fluctuations in demand for LED chips, which could impact its overall revenue. Additionally, the decline in revenue from lighting products indicates less demand for these products, potentially due to intense competition and the availability of cheaper alternatives from Chinese manufacturers.

Noteworthy

LEDS operates in a rapidly changing industry, and its sales in specific markets may fluctuate from quarter to quarter. The company's revenues have been concentrated in select markets such as the Netherlands, Taiwan, the United States, Germany, and Japan. LEDS also highlights the impact of significant government incentives and subsidies in the Chinese LED industry, resulting in production overcapacity and intense competition.

Summary

LEDS reported a decrease in revenue for the fourth quarter of 2023. While the LED components segment showed strength with higher volumes sold, the decline in revenue from lighting products and challenges in the LED chips segment indicate potential weaknesses. LEDS operates in a competitive market with production overcapacity, and its financial results may be impacted by general economic and political conditions in specific markets.

Source documents

Form 10-Q  filed on Jan 12, 2024
59 pages scanned

Reference data

Company financials Q4 revenue 1.7M
Analyst estimates Q4 EPS missed by NaN%
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